Pre Market Report, October 29, 2013 | Stocks and Commodities

P R Sundar, Aditya Trading Solutions

October 29, 2013
Time: 8.15 am

Pre Market Report:

1. Global cues are mixed today.
2. US markets were flat due to Apple's disappointing results.
3. An important thing to note is China's market is up more than 1%.
4. Surprise big moves came in our markets only when Chinese markets were good.
5. Last time Nifty moved by nearly 150 points when Chinese GDP came at 7.8%.
6. So today if RBI policy is good then same thing can happen.
7. Until 11 am markets will be choppy.
8. Since Bank Nifty has fallen by 250 points yesterday, downside should be limited.

Recommendation:

1. Sell November expiry Bank Nifty 10000 Put option and 12000 Call option. Once the RBI policy is announced and the markets settle down, volatility in Bank Nifty will go down and hence the premium. If RBI policy is negative, then cut the 10000 Put option and sell 9000 Put option. If RBI policy is positive, then cut 12000 Call option and sell 12500 Call option.